How Many Cryptocurrencies Are There?


There are now more than 12,000 cryptocurrencies, and what is really amazing is the rate of growth. The number of cryptocurrencies more than doubled between 2021 and 2022. By the end of 2021, the market was adding around 1,000 new cryptocurrencies every month.

This is not entirely good news. Many new cryptocurrencies have little purpose other than making money for their developers, which means investors need to be selective. Only a small portion of cryptocurrencies is worth learning about and potentially buying.

Why has the number of cryptocurrencies grown so rapidly? We will answer that and cover the most important and influential cryptocurrencies below.

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Description

Bitcoin (CRYPTO:BTC)

The first cryptocurrency and the largest by market capitalization.

Ethereal (CRYPTO:ETH)

The cryptocurrency with the first programmable blockchain that developers can use to create decentralized applications (dApps).

Tie (CRYPTO:USDT)

A stable coin that follows the US dollar and the cryptocurrency with the highest trading volume.

Cardano (CRYPTO:ADA)

A research-based cryptocurrency that is more environmentally friendly due to its low power consumption.

Binance Coin (CRYPTO:BNB)

The native cryptocurrency on Binance Smart Chain, which was created by the popular Binance exchange.

XRP (CRYPTO:XRP)

Ripple’s native cryptocurrency and the subject of an SEC lawsuit alleging it to be an unregistered security.

Moles (CRYPTO:POINT)

A cryptocurrency designed to allow different blockchains to communicate and work with each other.

Solarium (CRYPT: SUN)

A cryptocurrency with a high-performance blockchain capable of processing ultra-fast and cheap transactions.

doecoin (CRYPTO:DOGE)

The first memecoin to gain massive popularity.

Monero (CRYPTO:XMR)

A donation-based cryptocurrency that claims to provide full privacy through untraceable transactions.

Source: Author.

Why are there so many different cryptocurrencies?

The main reason there are so many different cryptocurrencies is that there are virtually no barriers to entry. Anyone who wants to create a cryptocurrency can do so. Even if you don’t have technical knowledge, you could still hire someone at five (New York Stock Exchange: FVRR) to make a cryptocurrency for less than $20.

It wasn’t always like this. In the early days, there was only Bitcoin. Then the developers began to create altcoins. An altcoin is any cryptocurrency other than Bitcoin. Most of the early altcoins were intended to improve the performance of Bitcoin or serve some other purpose.

The most successful cryptocurrencies still have a purpose or goal. Developers create cryptocurrencies hoping to use block chain technology to solve a real world problem.

Since it has become extremely easy to make a cryptocurrency, the amount of money in crypto has attracted people who are trying to make a quick buck. If you look at the charts of recently launched cryptocurrencies, you will see many like this, with some form of “Elon”, “Shib”, or “Doge” in the name.

If you’re looking for a good investment in cryptocurrenciesor if you are just interested in learning about some notable projects, here are the cryptocurrencies that have had the biggest impact.

Bitcoin

Bitcoin It was the world’s first cryptocurrency. An anonymous founder who went by the name of Satoshi Nakamoto launched Bitcoin in 2009. It was designed to be a decentralized digital currency that was not dependent on banks or financial institutions.

Newer cryptocurrencies are more technologically advanced and offer much more efficient transactions, which is why Bitcoin is now primarily used as a store of value. It has enjoyed a significant first-mover advantage as it is the most well-known and most valuable cryptocurrency by a wide margin.

Ethereal

Ethereal introduced the idea of ​​an open source programmable blockchain. Developers can take advantage of the Ethereum blockchain to create their own cryptocurrency tokens and decentralized applications (dApps). This has led to the creation of decentralized finance (DeFi) — platforms offering decentralized versions of traditional financial services.

Although there are now more cryptocurrencies with programmable blockchains, Ethereum started it all. Its early development has helped it firmly establish itself as the second largest cryptocurrency.

Tie

Tether is the largest stable coin, which is a type of cryptocurrency designed to track the value of another asset. In the case of Tether, its objective is to follow the value of the US dollar, which means that a Tether is normally worth $1.

This cryptocurrency is not without controversy. The company behind it, Tether Limited, lied about its reserves when it falsely claimed that each Tether was backed by one US dollar. Despite that and other problems, Tether is usually the cryptocurrency with the highest daily transaction volume.

Cardano

Cardano is an open source blockchain platform created by one of the co-founders of Ethereum. Its goal is to solve a wide range of problems, including making financial services and identity records accessible to everyone. Cardano’s development is based on peer-reviewed research, so it tends to progress more slowly than other projects.

This was one of the first major cryptocurrencies to use proof of stake to verify transactions. This is a more energy efficient alternative than work testwhich is used by Bitcoin and many other major cryptocurrencies.

Binance Coin

Binance Coin is the native cryptocurrency on Binance Smart Chain. This blockchain platform was created by Binanceone of the most popular in the world crypto exchanges. It quickly became a popular alternative to Ethereum due to its significantly cheaper gas (transaction) fees.

Gas fees on Binance Smart Chain are paid in Binance Coin, so you must have it to use that blockchain. The Binance exchange also offers discounted trading fees for customers who hold Binance Coin.

XRP

XRP is the native cryptocurrency for Wave, a payment protocol created for fast and low-cost transactions. It is specifically designed for international money transfers and there are hundreds of financial institutions that have partnered with Ripple to use its technology.

Ripple is notable for being involved in a lawsuit with the SEC. In late 2020, the SEC alleged that Ripple sold unregistered securities in the form of XRP. Although Ripple denied the allegations, many major crypto exchanges stopped offering XRP trading in response.

Moles

Polkadot is a platform that aims to expand interoperability between blockchains. Blockchains that connect to Polkadot can transfer any type of data or assets between each other.

While Polkadot has similarities to Ethereum in that it is a programmable blockchain, it takes things one step further. Developers can create their own custom blockchains on Polkadot. It also allows for parachains, which are parallel blockchains that work together and each have their own specific uses.

Solarium

Solana is a blockchain platform built for speed and efficiency. It regularly processes thousands of transactions per second and is capable of handling 65,000 transactions per second. The average cost per transaction is well under a penny.

While Solana uses proof of stake to validate transactions, it also introduced a new method called proof of history. The method creates a historical record of when transactions occurred and is one of the keys to Solana’s fast performance.

doecoin

doecoin is a cryptocurrency based on the Doge meme. The creators of the coin launched it in 2013 to mock cryptocurrency price speculation. It is widely considered the first memecurrencyand has spawned many imitators over the years.

Although Dogecoin does not have competitive advantage or single use case, it has managed to become one of the most popular cryptocurrencies. Dogecoin and the memecoins that followed are proof of how much hype can matter in the cryptocurrency market.

Monero

Monero is a cryptocurrency that uses privacy-enhancing technologies for transactions. This makes transactions anonymous and untraceable. Most cryptocurrencies have public blockchains that provide all transaction data, but with Monero, observers cannot see any of this information.

That has made Monero extremely popular with privacy-conscious cryptocurrency enthusiasts, but it can also be used for criminal activities such as money laundering and tax evasion. The IRS has offered hefty rewards for anyone who can crack Monero.

Why are cryptocurrencies important?

Cryptocurrencies improve aspects of traditional ones fiat currency. They do not need the support of a federal government and process transactions entirely on their own, without financial institutions. Using a cryptocurrency, people on opposite sides of the world can transfer funds quickly, cheaply, and without any payment services.

Although the original purpose of cryptocurrency was to replace traditional currency, that is no longer the only use. Developers are continually finding new ways to use cryptocurrencies and blockchain technology to solve real-world problems.

With so many cryptocurrencies available, it can be hard to know where to invest. It is important to carefully research any cryptocurrency you are thinking of buying. In case of doubt, cryptocurrency stocks and the largest coins tend to be the safest investment options.